House Ed & Labor Markup H.R.1984, H.R.1988

During the House Education and Labor Subcommittee on Health, Employment, Labor and Pensions mark-up of The 401(k) Fair Disclosure for Retirement Security Act (H.R.1984) and The Conflicted Investment Advice Prohibition Act of 2009 (H.R. 1988), Chairman Robert Andrews (D-NJ) said the rare subcommittee mark-up allows for an 'airing' of all the issues surrounding the two bills prior to consideration by the full Committee. Andrews was unsure when the full Committee would consider the two pieces of legislation.

Calculate My FREE Annuity Quote Now!

  • Optional: For a 2-person annuity (joint lives)

No agent will call you

Your privacy is guaranteed.
Find advanced calculator options here.

Get quick answers to your annuity questions: Call 800-872-6684 (9-5 EST)

Subcommittee Ranking Member John Kline (R-MN) said he could not support H.R.1984 or H.R. 1988 in their current form. Kline noted H.R.1984 is similar to legislation considered in the 110th Congress, and he continues to have major concerns about the legislation. He recounted that he withdrew his amendment at that time on the condition both sides would work to improve and later incorporate the amendment. Kline said he was concerned that H.R.1984 authorizes the federal government to dictate plan investment models, and mandates a specific investment option, which a majority of plans already offer, and in addition the bill does not have provisions to address plan sponsor liability.

Kline described H.R.1988 as a 'disservice' to the Pension Protection Act of 2006, which makes investment advice more widely available to defined contribution plan participants. Kline also expressed concern there has not been a hearing on H.R.1988 to date, and the legislation would create the unintended consequence of disrupting investment advice arrangements already in place in the markets. He added that he believes the hyper-regulation of investment advice could lead to less advice and higher costs. Kline said he was encouraged that the legislation would not affect exemptions already in place.

The 401(k) Fair Disclosure for Retirement Security Act (H.R.1984)

Chairman Andrews offered an amendment to H.R.1984 in the nature of a substitute. Rep. Carolyn McCarthy (D-NY) said she was concerned about the underlying legislation because the increased disclosure requirements could increase fees, and the mandate of an index fund may designate a model, which may not provide sufficient retirement savings. McCarthy noted fee disclosures, should be permitted electronically. Andrews indicated the bill has provisions to encourage the electronic distribution of disclosure, and would work with McCarthy further to address this issue. Rep. Joe Courtney (D-CT) said he is also concerned about mandating an investment choice like an index fund. The subcommittee passed H.R.1984 by a vote of 13-8. The bill now moves to the full Committee for consideration.

Testimonial Image
I contacted Immediate to buy one of my immediate annuities. They were prompt, very responsive, paid attention to detail, understood my objectives, and were superb when it came to staying on top of seeing the funds transfer and issue of new policy documents through to completion.
Dr. David Babbel Professor Wharton School
Read 650+ verified reviews

The Conflicted Investment Advice Prohibition Act of 2009 (H.R. 1988)

Chairman Andrews also offered an amendment to H.R.1988 in the nature of a substitute. McCarthy offered and amendment to the Andrews amendment, which would expand the outreach efforts of the Department of Labor (DOL) and make greater financial literacy resources available to young workers. DOL would also be tasked with conducting a survey to study the impact of the DOL efforts. Rep. Dennis Kucinich (D-OH) said he believe it is important to educate consumers about the impact of debt obligations. McCarthy agreed to work with Kucinich on enhanced language. Andrews noted that changes to the Workforce Investment Act could require financial literacy education as part of job training. The McCarthy amendment was approved. The subcommittee passed H.R.1988 to the full Committee with a favorable recommendation.

We'd love to hear from you!

Please post your comment or question. It's completely safe – we never publish your email address.

Add a new comment: (Allowed tags: <b><i>)

Comments (0)

There are no comments yet. Do you have any questions?